>> charlie: welcome to our program. tonight, sebastian pinera, the new president of chile. and four iranian americans on the future of iran. ahmadinejad, and change. chile, and iran. next. funding for "charlie rose" was provided by the following. >> over a century ago, gottlieb daimler wrote four words tharp a -- that were a promise to himself and to the world. a promise to invent the first automobile and to keep reinventing. to build the type of cars that define true performance while never sacrificing their true beauty. and to introduce innovations that help save lives and the planet. four simple words mercedes benz lives by to this day. the best, or nothing. that is what drives us. >> additional funding provided by these funders.

>> and by bloomberg. a provider of multimedia news and information services worldwide. ♪ >> from our studios in new york city, this is "charlie rose." ♪ >> charlie: sebastian pinera was elected president of chile in january with a mandate to create jobs and bolster the economy. he is chile's third richest citizen. 13 days before he took office, his country suffered one of the most devastating earthquakes in recorded history. he dubbed himself the reconstruction president and made earthquake recovery his top priority. he is here in new york for the united nations general assembly. i am very pleased to have him here at this table for the first time. first of all, welcome.

>> thank you, charlie. >> charlie: tell me about the earthquake and how you approached that. >> it was the fifth worst earthquake in the known history of mankind, and it s devastating. it was 10 days before we took office, and it really cost us first of all more than 500 lives. there are a lot of people missing still now. in terms of destruction, it was devastating. we lost one-third of our schools. so 1.35 million students couldn't go back to school because their schools were destroyed. one-third of our hospitals. we lost almost 200,000 homes. 1,000 miles of roads, bridges, airports, ports -- it was really devastating, but i am proud the way we have faced it because the chilean people are reconstructing the country and we are doing a very good job. >> charlie: what did you learn in doing this? >> that first of all, you have

to unite the whole country in order to achieve the goal of reconstructing everything that was destroyed by the earthquake. secondly, i think that if you have the right leadership and you are able to commit everybody in this task, you are able to achieve those goals. in less than six months, we have been able to reconstruct a good part of what was destroyed. first of all, in 45 days, we were able to put back to school all the 1.25 million students with extraordinary measures like emergency school and using all types of facilities. in 60 days, we were able to restore the function of our health system. in 90 days, we were able to rebuild all the bridges that had been destroyed and put to work, again, airports and ports. so i think that the chilean people reacted in a very, very united and very strong way. and in the meantime, we have also been able to put the economy back to work.

because now, our economy is growing in a very, very strong and sustainable way. we are creating more jobs than ever in our history and therefore we are very committed and very confident. >> charlie: let me talk about the earthquake for a second. what was the international response? >> we received a lot of help, but at the end of the day let me be honest. the total cost in terms of destruction was about $30 billion. that represented 17% of our g.n.p., in the case of katrina it was less than 1/10th of 1% of g.d.p. >> charlie: what percentage of your g.d.p.? >> the main effort had to be done within our own borders. >> charlie: the economic issue. what did you do when you came to office to try to put chile on a

pro growth track? >> chile had 12 years of fat cows from 1986 to 2008. from 1986 to 1998, we had 12 years of fat cows. the economy was growing at 7% per year. we were creating jobs. in that time period, we recovered our democracy which is the natural way of life for the chilean people, but unfortunately starting with the asian crisis in 1998 until last year we went through a lean-cow period and investment went down, job creation capacity went down, so our main goal and our commitment with the country was to restore our ability to restore our ability to create jobs and face problems, and we have been really very successful -- i say we because it's the whole chilean people thar behind this effort. let me make a comparison.

last year's growth rate was minus 1.5%, this year will be 5.5%. last year we destroyed 30,000 jobs, this year we will create 300,000 jobs. >> charlie: how are you creating these jobs? >> basically, by getting the best out of every chilean. i remember that once margaret thatcher said, "let's make britain great again" and that was the real goal. we are trying to restore what was once known as the chilean miracle and -- and we are working for that and we have two main goals and they are ambitious but possiblement we would like to be the first latin american country that before the end of this decade will be able to say that we have defeated poverty and defeated underdevelopment. we are slitting right now, many latin american countries 200 years of independence and we haven't been able to defeat poverty and underdevelopment and

i think that there is nothing that will stop us from that goal. >> charlie: part of that is because the president's obsession is about poverty, isn't it? >> yes. >> charlie: where does that come from? >> chile is a country that has 14,000 dollars of per capita income, so we are in the middle of the road towards development. and we want to achieve $24,000, put us with countries like portugal and countries in the southern part of europe and for that we need to do many things. first of all, we need to increase dramatically the quality of education that our students are receiving. and we are working in that area. we are doubling public investment in education. >> charlie: one to 12? our university level? >> first of all, we start with primary schools and secondary schools and, of course, we have to continue with university level. we need to increase the level of

investments because we need to invest much more than we are investing now. this year the investment rate will go up 25%. that means that there is a lot of confidence in what we are doing. >> charlie: you're attracting foreign investment? >> we are attracting foreign investment, especially in the manufacturing sector and and the mining sector and the fishing sector, we have a lot of foreign investment. >> charlie: who are your biggest trading partners? >> today is china. used to be the u.s. but today china is by far the biggest trading partner. >> charlie: for both chile and brazil? >> yes. it will become the first trading partner of the whole latin america. and i think the u.s. is missing opportunities. >> charlie: because they are doing what? >> they -- i don't think that they have -- or put enough attention to lat inner america. in terms of free-trade agreements there are many latin american countries that would like to reach a free-trade agreement with the u.s. which is

beneficial to both parties and i think that the u.s. is not moving fast enough -- >> charlie: because of the political issues in the congress? >> yes, because many times we are waiting for the next election. for instance now nothing can happen because we are expecting the november election and i think that the u.s. could do a better job vis-a-vis latin america -- and i'm not talking about aid, i'm talking about partnerships, about facing together the challenges of development in the future. i heard the speech of president obama at the millennium summit. >> charlie: right. >> and i think the speech is right, but i also remember when president bush, the father, said that he was going to create a free-trade agreement -- a free-trade zone from alaska to the southern part of south america. we are still waiting. >> charlie: what is your primary export? right now to china. give me a sense of the whole phenomenon of china going around the world with huge contracts

for natural resources. >> we are supporting many goods to china. >> charlie: you doind find there will be a market for your manufactured goods? with their developing middle class? >> yes, because i feel that sooner or later they will have to open up their economy more so than they've already done. >> charlie: what are the difficulties are trading with china? >> first of all, i think they have an overvalued currency. >> charlie: that's being changed now. or they say they'll change it. >> it is changing. slowly, but it is changing and that will open up a whole world of opportunities for countries that export more to china. our second trading partner is the u.s. very close to europe. but china is now the first trading partner. >> charlie: and widening the gap? >> and widening the gap. >> charlie: what else other than copper do you trade with china? >> fishing products.

timber and wood. and we are importing from china also a lot of manufacturing goods. and we have to compete with them but that's part of life. if you want progress. >> charlie: when you look at latin america -- you look at ecuador. you look at venezuela. there is a certain kind of leadership. you look at chile. there is a certain kind of new leadership. you look at argentina. there is a different kind of leadership. then you look at brazil and you have lula, who is amazingly popular and surprised many people in terms of his executive abilities. what are the trends that are happening -- or is a mixture of political dynamic taking place? >> each country has the right to follow its own path but let me tell you that i can see two different paths in latin america. on the one side, cuba and venezuela which are following a path in terms of how they face the democratic process and the economic development which i think is not the right path.

other countries like mexico, peru, colombia, chile and peru that follow another path. i believe in real democracy where you really respect the division of power between the different power of the state where you respect the opposition, you respect freedom of press. i believe in open, competitive, transparent economies where the innovation and entrepreneurship capacity of the people are the main engines to development. i believe in equality of opportunities. those are my values, and i think that those are the values that will lead us towards development. look what fidel castro said. a few days ago, he said that his form of government doesn't even work for cuba. >> charlie: when you look at chile today and think about the demands on chile, is there --

where is the tension? that exists in a state like chile? or is there tension? >> there is always tension, of course. >> charlie: what is it about? is it about rich and poor? is it any about the kinds of issues that you addressed in the millennium summit? >> yes. chile and many countries are celebrating their first 200 years of independence and we have had everything. a huge continent. very rich in terms of natural resources. people that have been free of world wars like europe or problems like africa or problems like ireland -- and still we haven't been able to achieve our goals, so i think that nowadays in latin america we have realized that we have not been really facing our challenges the way we should, and i think that now latin america wants to become a developed country, and we would like very much to achieve that goal within this

decade. that's why the main goal of my government is to defeat poverty and to defeat underdevelopment, and we are moving in that direction and we are doing a good job in terms of results because the country is growing. we are creating jobs. we are fighting crime and drugs in a much more efficient way, we are improving the quality of education of our children and the health of our families in a very fast way, so i think that the 21st century may be the latin american century. >> charlie: what about gender equality? >> we have a long way to go in that area -- we have come a long way in that area, but we still have to move forward. for instance, in terms of education, there are quality of opportunities. in terms of access to the job force, we need to move forward because one thing that happens is all the cost of maternity -- normally is -- >> charlie: right. >> in the hands of women.

we should share those -- >> charlie: the cost of maternity are in the hands of women. >> yes. they have to take care of children. they have to take care of family. >> charlie: and you are going to change that? >> yeah. we are changing that. for instance, we are trying to share that -- it's not a burden, it's a joy, but to share that joy between men and women in equal parts. >> charlie: some say that some in latin america, and this has been my own experience, sense they were up -- they were on a certain level of growth and then along came the economic crisis and recession and growth inevitably slowed. some say they blamed that on america and american capitalism and said, "look, you brought this on us, you created this global crisis." >> that was an old -- and very wrong -- attitude towards america, because everything was to be blamed on america. and anything happened in latin america, the people would go to the american embassy to throw stones.

>> charlie: i'm talking about this most recent economic crisis. >> no. that has changed. we understand the crisis was not only in america, but america and europe, it was a worldwide crisis. >> charlie: it began here and made decisions here that started and others bought into it. >> it began here. in other cases it was just the opposite. the crisis began in russia or in asia and the american economy was the one that was able to pull the whole world out of recession, so we don't blame it in america but we understand that a lot of mistakes were committed in the way that this crisis was faced. >> charlie: there is also this in terms of america's image. in the long history of america's image with latin america, there were issues in terms of who america supported and who it did not support that gave this country a certain image. does that image linger in the perception of the vast mass of people in chile and in latin

america? >> it is a lot. >> charlie: from country to country. >> the origin of the word "gringo." >> charlie: what is the origin? >> many americans are called gringos abroad. >> charlie: i know that. >> because they used -- a green uniform and people used to tell them, "green, go home." >> charlie: is that right? "green, go home"? >> yes. i would say that we realized that the u.s. is a tremendous, magnificent country in terms of freedom. in terms of accomplishment. in terms of innovation. in terms of courage to face the big challenges, so i think that the chilean people have a very good image of the american people. >> charlie: the notion of the united states size a country that propped up dictators and all that is no longer the reality that people perceive across the -- >> we see the u.s. as a big partner for development, and we

share with the u.s. very strong values. we share the values of -- >> charlie: democracy. >> democracy. human rights respect. the value of freedom. the value of innovation. the value of social market economy. the value of facing the challenges of the future with bravery. those are values that are very much shared between the american people and the chilean people. >> charlie: what is the legacy of general pinochet? >> he's part of the past. i think that he will -- he will always be blamed for the human rights as that took place in his government and that is something which is unforgettable, and also, i think that it's unforgiveable, because what happened in terms of human rights -- >> charlie: did he ever accept responsibility for that? >> he never accept publicly responsibility, but i also have to tell you that even though he interrupt our democratic life

for 17 years and his government committed a lot of human rights abuses, there are other areas -- >> charlie: other people died in -- >> there are other areas where he was able to modernize the economy. to open the economy. to establish an economic system much more open and competitive and therefore some things were very positive for the future of the country. the best proof of that is that when the democratic system came back to chile in 1988, many of his reforms stayed in place. >> charlie: back to the relationship with the united states, though. if china is your biggest trading partner, does that mean, by definition, with the understanding of the power of economics, that china has as much influence in chile as the united states? >> no. no, no, no. of course not. >> charlie: because of history? because of values? >> because of values.

because we belong to the western world. no, i wouldn't say that. of course, the u.s. has a tremendous influence. the u.s. culture. >> charlie: movies and -- >> and the same thing with europe. we are proud of the western world, but we are opening up our economy. chile is is a very open country. we have free-trade agreements with 58 countries. i think that is probably only mexico and maybe israel have so many free-trade agreements so chile is a very open economy and we are trading with asia. we have a free-trade agreement with europe, with the u.s., with china, with india, with korea, with japan, so we have a lot of trade with asia, but of course from a cultural point of view, we are very -- we feel much closer to the u.s. and to europe. >> charlie: you also -- in latin america set up a regional organization, did they not, which is part of the hemisphere but the united states is not part of it? >> yes. that's unisar. >> charlie: what's the purpose of that? >> that's an organization that

has joined all the south american countries. we have another organization. the o.a.s. which includes only south america and north america -- canada, mexico and the u.s. >> charlie: organization of american states. >> uniso should not replace the organization of american states. you are americans and we too are americans. >> charlie: do you worry about mexico as a failed state? >> i have a lot of trust in mexico. >> charlie: in the capacity to deal with this level of violence from non-state -- level of violence from non-state actors? >> when they decided to start this huge war against drugs, and always that war is very painful and costs a lot of lives, but i hope that at the end of the day they will succeed, because otherwise, if you don't, i think that terrorism and narcotraffic

are very cruel and powerful enemies, and you have to fight them with all the instruments of your democratic system and your state of law. >> charlie: fed by two things. both demand and supply. >> yes, and they have -- they have -- the united states right on the borders, and the main demand for drugs comes from the u.s. so that's another problem. >> charlie: that's our problem to deal with. >> it's your problem and it's also our problem because when you have a huge demand in the u.s., that will incentivate a huge supply somewhere else, and that's the story of our -- that's why we have to build together, and i would like very much that the u.s. should have two commitments. one will be to fight the supply side. >> charlie: right. >> but they also should fight in a stronger, more efficient way the demand side, because at the end of the day, if you have

demand, supply will always -- >> charlie: if you have demand, there will be economic opportunity and there will be a supply. correct? >> yes. so i think that the only way to defeat these drugs is by fighting both sides. >> charlie: so what? i had a group of latin-american experts, academicians, five or six of them and they basically had this point to make. that latin america had clearly changed and was on the move, you are a representative of that and brazil is a representative of that, and they argued that the obama administration so far was missing an opportunity to communicate to latin america, both its leaders and its people that it understood where you were in your history and that you were, in a sense, in a growth period. >> i agree with that. i think that the u.s. should pay attention.

not only pay attention but do a better job. for instance, i think that the same thing that president obama did in ghana when he made a speech to the african world, or in egypt when he made a speech to the muslim world, he should do the same thing with latin america. i have invited him to come to chile and try to start a new age in the relation between latin america and the u.s. we're on the same continent, and still we are not really working together as we should. >> charlie: the secretary of state came to latin america. >> yes. >> charlie: and that sent a signal. >> that is a signal. but i think that there are so many things that we can do together. >> charlie: trade -- trade is a place to start. >> trade is one point. investment. and also to face the political challenges. we are facing new challenges and we need to work together.

terrorism. narcotraffic. climate change. the only thing that we can really be efficient in dealing with those big challenges is to work together and i think that we should be working together in a much more close and efficient way with the u.s. >> charlie: the world is not doing very well in terms of working together on things like climate change, is it? >> no. no. no. because basically what we have is -- international system that was created after the second world war in breton woods 60 years ago. now the world has changed so dramatically, the challenge is so different that we need a new system and that's part of the reform we have to undertake in the united nations, the world bank, the i.m.f. and many other international institutions. >> charlie: do you think the dollar should remain the reserve currency of the world? >> i don't think so. >> charlie: you don't? >> no. >> charlie: what do you think? >> i think that a reserve country of the world -- >> charlie: reserve currency.

>> you need to have more stability. you see what's happened with the huge fiscal deficit and current-account deficit that the u.s. is running, they are jeopardizing the possibility of having the dollar as a reserve currency of the world. >> charlie: i have had, as you know, a lot of people like yourself come to sit at this table and talk about how they see the world. most of them say the thing i worry the most about is the united states getting its financial house in order and dealing with its both fiscal and current-accounts deficit. >> i agree with that. >> charlie:li quan yu from singapore. >> you cannot live beyond your means and the current account deficit and fiscal deficit will have to be reduced. the sooner the better. >> charlie: your family was involved in politics? >> my father was involved in politics. >> charlie: he was ambassador? >> he was ambassador to the

united nations and to the european community. >> charlie: during the pinochet government? >> no. during the father. >> charlie: the father. >> before. my father was -- my father and myself were always in the opposition to the military government for principles like our strong commitment with democracy. our strong commitment with human rights. those were the main reasons. and one of my brothers was involved -- was a minister of the military government. another brother was part of the government of the center-left coalition. after 20 years we were able to defeat them democratically. >> charlie: you defeated the party that your brother had served in? >> yes. >> charlie: how do you -- -- how is it that the family had such

diverse physical views? >> my father promoted our freedom of choice and freedom of thinking. he always told us "do whatever you want, but do it right. do it with passion. >> charlie: exactly. >> don't stay sitting in your comfortable -- >> charlie: do what you love and do it with passion. >> and do it with passion. actually, he was very, very important in promoting this public service vocation. my first vocation was academic. >> charlie: economics professor. >> yeah. i came to harvard. i got a ph.d. and i was a university professor for many, many years. and then one day i decided to change and i went from the academic field to the entrepreneur field from one day to another and i started creating companies for nothing. because we didn't -- i didn't inherit any material thing from my father. >> charlie: you have brought something here that is representative of why the world

has been focused on chile. show it to us. >> let me show you something. that was the first message that the 33 -- >> charlie: look at that. >> that were caught -- trapped 2,000 feet in the mountain. they sent to the surface. it says, "all of us, the 33, are in the shelter and we are fine." and this happened after almost 20 days. >> charlie: wow. >> nobody knew whether they were alive or dead. >> charlie: right. >> and we are now doing our best efforts to rescue them alive, and when we were able to see them and they realized that we had discovered them and therefore the rescue effort was really being successful, they were happy like kids -- jumping, singing, dancing, and i saw them. it was so emotional. let me tell you something. that day, there was an explosion

of emotion and joy in each and every home in chile, and i think many other countries in the world, and immediately after, we told them -- after the first chat, which was more or less -- we had to increase in order to be able to rescue them. it is very tough because they are very deep in the mountain and the rock is very, very hard. but i hope that by the end of october, beginning of november, we will be able to rescue them. >> charlie: you call it project jonah? >> yes. because prophet jonas was eaten by a whale and rescued from the bowel of the whale and we are going to rescue these miners from the bowel of the earth, and therefore, it was so emotional. i cannot tell you my feelings when i knew that they were alive. i was there. i was in the mine, and i have dreamed so many times of the day when they would come out out

surface. >> charlie: a national day. of celebration. >> to be with their mother, father, sons, daughters. >> charlie: a great story. >> it is a great story. >> charlie: and a continuing great story. sebastian pinera, president of chile, we are deeply pleased that he stopped by on his visit to the united nations and to the united states to come see us. thank you. >> thank you, charlie, for this opportunity. >> charlie: earlier today, president obama spoke with the impasse between iran and the international community over nuclear program. addressing the united nations general assembly in new york, he said. >> the united states and the international community seek a resolution to our differences with iran and the door remains open to diplomacy should iran choose to walk through it. but the iranian government must demonstrate a clear and credible commitment and confirm to the world the peaceful intent of its nuclear program. >> charlie: the president also

spoke passionately about human rights. >> freedom, justice and peace for the world must begin with freedom, justice and peace in the lives of individual human beings. and for the united states, this is a matter of moral and pragmatic necessity. >> charlie: human rights are a critical part of the conversation about iran today -- even more so after the protests that followed the june 2009 election. president mahmoud ahmadinejad, who is in new york this week, spoke at the general assembly today. here is a part of what he said. >> in identifying those responsible behind the september 11 attack, there were three viewpoints. first, that a very powerful and complex terrorist group able to successfully cross all layers of the american intelligence and security carried out the attack. this is the prevalent viewpoint which has been supported mainly and advocated by american

statesmen. second, that some segments within the u.s. government orchestrated the attack to reverse the declining american economy and on the middle east in order to save the zionist regime. the majority of the american people as well as most nations and politicians around the world agree with this view. third, it was carried out by a terrorist group but that the american government supported and took advantage of the situation -- apparently, this viewpoint has fewer proponents. >> charlie: joining me are four iranian americans who live and work in this country as well. abbas milani of stanford university, karim sadjadpour of the carnegie institute.

farnaz fassihi. i am pleased to have all on this program to talk about iran which everyone this week in new york city, at least, are talking about iran, whether it is the iranian president who is speaking at the u.n. today but has been doing a number of interviews. the president of the united states is speaking today in an interview i did yesterday with the russian foreign minister, with turkey -- the turkish president was here last night, we talked about iran, so it's appropriate now in a sense to bring people who are iranian-americans to talk about how they see these issues so let me begin from washington -- from hali esfandiari, what's happening in iran today, how you see where they are a year-plus after the election? >> a lot is going on in iran today. first of all, i don't think that the green movement is dead. i think it might be a bit dormant but it's not dead. the other night, one was

interviewing ahmadinejad here. there were people on the roofs of tehran and probably other iranian cities once again shouting "god is great." secondly, i think what is more important is the division in the regime. this is unbelievable. the president is trying to undermine -- is trying to undermine parliament. it's trying to undermine the expediency council. he is trying to undermine even the supreme leader by even ignoring -- at least, his calls. the supreme leader called recently for unity among the regime leaders and the president is ignoring it. >> charlie: what is to be said about this tension between the

president and the supreme leader? >> i think there is tension between the president and the spiritual leader, and more importantly, i think, there is increasing pressure amongst the conservatives, particularly in the parliament. i think one can say safely for the first time in ahmadinejad's five year there has been open talk of the possibility of impeaching him. two very prominent members have in the last two weeks written either open letters to ahmadinejad or have given interviews where they have said, "we can impeach you if you continue defying, if you continue not implementing our orders to you, if you continue talking about the supremacy of the executive branch as he has done, we might in fact impeach you, and if they haven't done so far it's because the international situation has not allowed it, so the tensions within the conservative and the tensions within the top clergy

and the regime and within ahmadinejad's camp and the irgc, even, the revolutionary guard i think have never been as fierce as they are now. >> charlie: where are the revolutionary guards now? there are some stories i have been reading that they're closer now to ahmadinejad, that he's leaned to garner their support. is that true? >> i think ahmadinejad's support does come from at least a wide branch of the revolutionary guards. they've become much more prominent in iranian politics, in the iranian economy and also the media trying to dominate the political conversation, so he does enjoy their support and i think it's critical to see how long that's going to extend. i think that rightly, we can assume that the clerical powers in iran are weakening and the military wings of the revolutionary guard are becoming much more prominent. >> charlie: how is the economy

doing in iran? what happens if sanctions imposed? >> the economy is under tremendous pressure both domestically and internationally and it's oftentimes difficult to discern what is the underlying cause of the economic tumult. is it economic sanctions from the united states? from european countries? or is it the profound domestic mismanagement? there is incredible mismanagement within iran. anecdotally the stories are remarkable, people coming from iran tell me that the price of meat is almost double the price of meat in washington, d.c. so i think that people are having -- the elder generation of iranians recalls the economic dignities they had prior to the revolution and they look with disfavor at this economy, and the younger generation of iranians, there is incredible unemployment but also underemployment, the number of educated iranians you meet -- engineers, architects who are forced to drive taxis and sell

pizzas is incredibly disheartening. >> charlie: one of the questions that came up about him and what he has been saying and what he has been doing is that iran can withstand the sanctions. >> i think it's nonsense what he -- yes, i think it's utter nonsense what he is saying. they are relying on imports. i think just an anecdote, when i was in iran in 2007 you could find fruit from chile. if the sanctions are imposed it's going to affect even the goods that people use in their everyday life, so i think he's just trying to put a very good face on the sanction issue because internally, he is under a lot of criticism for having created that kind of setup to be

sanctions. -- sanctioned. >> i have to agree with haleh. the central bank of iran came out with a report last week saying that the economy is in crisis and that the number of bounced personal checks and business checks was 38% higher this year than last year. almost 2,000 checks bounced so he can kind of sugar-coat the sanctions and the economic crisis, but even inside iran there are official organizations coming out and saying "here are the statistics, we are having problems, companies are closing down, we can't import, we can't export, we can't open letters of credit," these are tangible problems they're facing. >> one of the ayatollahs -- probably the second most important ayatollah -- the ayatollah that leads the prayers in gom said last week that the statistics that mr. ahmadinejad gives about unemployment, about inflation are all bogus. he said that people know these are bogus figures, quit giving them because you're undermining

the credibility of the entire government. 40% of the entire liquidity of the iranian economy is now in bad checks -- in other words, the amount of bad checks, the amount of unpaid loans right now in the iranian economy is about three times it has been since the beginning of the banking for the last 150 years. that's how serious the economic situation is. but ahmadinejad walks around like mr. magoo, says everything is ok, we're going to withstand, it's going to make us stronger, as if he operates in a parallel universe that bears no relation to reality. >> charlie: as you suggested to me earlier, you have never seen a head of state that you think is prepared to say more untruths? >> i have never in my life seen a head of state look an interviewer in the eye -- look the camera straightforward and

lie about something he knows the international community has been filled about the stories -- the story of the stoning. he said, "no one has been accused -- condemned to stoning in iran." for three weeks, that was the top of the news inside and iran and outside iran. he looked into the camera and he said, "i am the head of state, i say no one was stoned, end of story." >> charlie, whenever i watch ahmadinejad doing interviews, i am reminded of a famous "seinfeld" episode where george costanza asked the secret of lying and george said to jerry "it's not a lie if you believe it" and sometimes i think ahmadinejad is delusional, he believes that iran is the freest country in the world, he believes it has an incredibly prosperous economy. >> charlie: let me come back to the question of stoning. where does that stand? >> the case of this woman is suspended right now. however, there is documentation out there from iran's central courts where she has been

condemned to stoning, where the sentencing was registered and it's available on the internet. human rights organizations have put that out in response to mr. ahmadinejad saying she was never sentenced to stoning. i suspect that after the international outcry she will not be stoned, especially after mr. ahmadinejad went on tv saying there is no such sentencing, so in some sense that is a victory for human rights workers in trying to bring attention, but i think it's not just stoning. we have hundreds of political prisoners in iran. we have human rights workers, lawyers, students, activists whose case nobody really hears. they're not celebrated cases but they face torture every day and unclear what's going to happen to their case and it's very difficult to get an answer from the government where their cases stand. >> charlie: when you raise that question as a journalist, what do they say? >> i asked this question. i asked this question of mr. ahmadinejad a few days ago

at a breakfast with reporters and he looked at me and said "we have no opponents of the government in jail, and they're all free, and that there are no political prisoners in iran." >> charlie: it's not just on television he says it. >> no, it's not just on television. >> charlie: go ahead, haleh. >> charlie, there are women activists that have been sentenced to long-term imprisonment just while he was here. a human-rights activist, a woman who promotes women's rights was condemned to -- sentenced to six years. so these are unheard of, usually in the past they would get a month and would be set free. first, they gave her over $600,000 bail and then they condemned her -- sentenced to this long sentence. so it really is not just a matter of the single woman

mrs. mohammedi. under ahmadinejad, the number of executions has increased by four times. the number journalists in jail is unprecedented in the world. and the clampdown on the press. so he's sitting there and just lying and looking in your eyes and in the eyes of everybody who is watching him on camera. >> charlie: and is this often talked about and debated in iran and in the press in iran and within the government of iran and the parliament? >> last 24 hours, one of the most high-plofile political prisoners in iran met with his wife and sent a -- highway-profile political prisoners in iran met with his wife and sent a message from prison that "i'm willing to come and debate ahmadinejad and show the lie to all his claims." this is someone in prison -- >> charlie: this has wide distribution in iran. >> it is widely distributed in iran. the regime tries to use these

interviews as a sign, as they it as a sign of iran's importance in the international community the fact that everybody wants to interview him is not seen by them as the fact that he has become a mr. magoo character and has become a caricature of a head of state, they see it as a sign of importance and they milk it, and from political prisoners within the last 24 hours a gentleman who is the undersecretary in the interior ministry met with his wife and said, "tell the international community, these are all lies and i'm willing to come and show and debate and prove it is false." >> charlie: what do you do and what do all of you do and beyond those of us who are reporters, what do you do to bring the pressure of an international community to the human -- to those cases? >> i think it's absolutely essential that we continue to

raise awareness. all of my friends who have been political prisoners in iran, including haleh will tell you it was heartening for them to know afterwards when they came out of prison that the world didn't forget about them. >> charlie: is the obama administration doing enough in terms of raising the issue of human rights? >> i think that they could be doing more. >> yeah. >> i think they could be doing more but aiven times looking in a broader context -- but oftentimes looking in a broader context of what the obama administration could be doing to help the green movement, we hear mixed feedback from iranians themselves as to the role the united states would like to play. some of the leaders of the opposition say they wouldn't like to see the united states be more outspoken but i think certainly the younger generation -- the young foot soldiers of this movement would like to see the u.s. more outspoken. >> charlie: i have asked this question. >> during the green movement protest last year, one of the slogans that people were chanting is, "obama, you're either with us or with them,"

meaning you take our side or you want to engage with the government" and i do believe that a lot of the green movement and opposition supporters believe that the obama administration has not done enough and they worry if the united states negotiates with ahmadinejad he will resurrect his troubles and his presidency and fix his legacy and then the opposition will lose credibility. >> charlie: what do you make of what the -- go ahead, haleh, i'll come back. >> charlie, i think that the obama administration can easily try and engage iran while condemn the violation of human rights. condemning the violation of human rights and the atrocities that are taking place in iran does not mean to come out overtly and let's say, "we support the green movement" so that it gives another excuse to the government in iran to repress on the activists because precisely saying, "didn't we say that they are promoting a velvet

revolution, didn't we say that they are stooges of foreign governments?" but i think that the obama administration should continue, just as the president spoke this morning at the u.n., continue condemning what is happening in iran. >> charlie: is mossavi under house arrest? >> virtual house arrest the. i'm told when he's in his home and wants to communicate important messages to people, he will turn up the volume of the television at full blast and whisper in their ears or if it's ultrasensitive information he will write a note, show it to the person and tear it up. it's very difficult to lead an opposition movement under those circumstances. >> people who have been coming in and out of his houses have been interrogated, have been sometimes put under pressure. >> charlie: if change is to happen, a change of regime is to happen -- and therefore, a change of policy, how will it

happen? >> i believe if it's going to happen, it's going to happen -- it is going to happen, but it will happen from within the country, just like the green movement which was an indigenous movement. it will not happen from outside the country -- the pressure on the government would be so much. the pressure on the regime would be so much. the economic pressuron them. the political isolation. that the regime will have to make extraordinary concession, and i'm told by people that it's not very -- i mean, the clerical community hangs on to power, so if they need to make concessions to survive, they will do these concessions. >> charlie: and you saw -- i'm told in the streets, people who were the sons and daughters of people who had been close to -- and in some cases of the regime, and their own children were in

the streets. >> the people they put on trial -- they put 100 people on trial after the election -- so-called election, these 100 people, if you go down the list, these are the architects of this regime. these are the ministers, undersecretaries who really build this regime, and i think the change that you are talking about, you can already see the outline of a coalition that is forming. a coalition that includes some pragmatic elements win the clergy who are seeing that shiism is losing big time in iraq, the technocrats who are running this regime and know the status quo is untenable and the evolution who realize what they have and realize the continuation of the status quo is, of course, the danger of losing everything. >> charlie: as my friends say to me frequently, "why are you see fascinated, obsessed, interested

in iran? >> because it's a wonderful country. >> charlie: paus it's a wonderful country. what else do i say? >> charlie: because it's a wonderful country. what else do i say? >> because in the middle east, i travel around the middle east all the time ooshths one of the only country where is this quest for democracy and change is grassroots and it's not from above, it's not like iraq or afghanistan where it's imposed by the government, it's actually kind of a secular movement. a people's movement has happened over the past couple of years. grassroots. and i think that's what's important. it's also important because it's strategically placed. it has oil. it's close to the persian gulf. it's got a lot of influence in the region. but other than that -- >> charlie: borders with efshg, almost. >> it borders -- >> charlie: borders with everybody, almost. >> it has a dynamic, educated population. >> iran is the bell weather state for the middle east, for the past 100 years everything has happened in the middle east

either in iran, turkey or egypt. read the bible. read herodotus. the two two canonical texts about civilization. in the bible, there is no nation that plays a more significant role in the freedom of jews, in the building of jerusalem than persians. iran is not two-bit hustlers who rule the country now. iran is one of the oldest civilizations in the world. it has produced hafez. it has produced cyrus, and in the 20th century it is the bell weather state for the middle east. you are very right to like it. >> i sometimes think, charlie, iran is like classical music or wine. it's just something that is so complex and so deep and has so many layers, and when i read my

own name in the press referred to as an iran expert i cringe, because i think that no one can be an expert on this country, it is so profoundly deep. >> charlie: haleh, i'll leave the last word to you. >> you are talking with someone who is in love with the flora and fauna of iran and feels to this day very betrayed by being arrested and put in jail by the country of my birth, that i love, but i think iran has always been a trend-setter, and even when it comes to women's rights, iran had one of the most progressive family laws in the region, and even after the revolution i'm meeting with iraqi women, meeting with women from the persian gulf, they would always tell me, "explain to us how the family law in iran worked so that maybe we can have

a similar law." women's rights has been always an issue in iran, again a trend-setter in the region. >> charlie: haleh, thank you so much, glad to see you again albeit via satellite. glad to have you here. abbas, thank you for traveling from stanford university to join us this morning. we thank you very much. ♪ ♪ captioning sponsored by rose communications captioned by media access group at wgbh access.wgbh.org